BRITISH ISP SETTLES LIBEL CASE OVER NEWSGROUP

Demon Internet, an Internet service provider (ISP) in Britain, yesterday settled a libel case that could break new ground in the online industry, Reuters reports.

Demon Internet’s parent company, Thus, settled with physicist Laurence Godfrey for what could amount to $318,000. The ISP hosted newsgroups containing posted material that Godfrey said were defamatory.

Lawyers tracking the case said it makes clear that ISPs could be held liable for material posted by readers on newsgroup sites even though the ISP does not have editorial control.

Reportedly, Godfrey complained to Demon that defamatory allegations against his character had appeared in newsgroups twice and the ISP did nothing to remove it.

The case doesn’t affect law in the U.S., but is part of the hodgepodge of Internet law developing around the world. Several American cases have held that ISPs are not responsible for information provided by third parties.